American Axle strike begins to hamper GM car production

Some 3,650 workers at American Axle are in the midst of a five-week strike over management's efforts to cut wages, and now the stoppage is beginning to reallyhurt one of the parts supplier's biggest clients -- General Motors. Much of GM's light-truck production has already shut down due to the strike, and now the automaker is being forced to stop building some passenger cars as well.

The General's Detroit-Hamtramck assembly plant, which builds the Cadillac DTS and BuickLucerne, will go dark as of March 31 unless American Axle can resolve its labor issues and start supplying the automaker again. Similar problems may also hit GM's Lordstown, Ohio, factory, which is running low on a brake part needed for the Cobalt and G5. If the situation continues it will also have to cease production.

GM doesn't want to get involved with American Axle's troubles, and as long as the automaker has a decent supply of inventory it can afford to wait. As of March 1 GM had a 59 day supply of Lucernes and a 100 day supply for the DTS, with similar numbers for the Cobalt and G5. Though the Lucerne and Cobalt inventories are low, the maker is more concerned about running out of trucks because of their higher profit margins. Right now GM still has a 106 day supply.

The strike at American Axle shows little sign of reaching a resolution anytime soon, with management recently threatening to move production overseas if workers don't accept their terms. At the moment GM isn't worried, but if nothing changes in the next months the automotive giant may have may have to start knocking heads together if it wants to avoid shortages of its models.